[Congressional Record Volume 149, Number 112 (Friday, July 25, 2003)]
[Extensions of Remarks]
[Page E1627]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page E1627]]
      UNITED STATES-CHILE FREE TRADE AGREEMENT IMPLEMENTATION ACT

                                 ______
                                 

                               speech of

                          HON. HENRY A. WAXMAN

                             of california

                    in the house of representatives

                        Thursday, July 24, 2003

  Mr. WAXMAN. Mr. Speaker, despite serious reservations, I will support 
the U.S. Free Trade Agreements (FTA) with Chile and Singapore. I 
support these agreements because I believe Chile and Singapore are 
valuable economic partners and strategic international allies. I have 
serious concerns, however, that the agreements also have a number of 
provisions that, while acceptable in the case of Chile and Singapore, 
set bad precedents for the future.
  Chile and Singapore are important markets for U.S. products and 
investment. As anchors of trade in Southeast Asia and Latin America, 
they are advanced economies with political openness and a growing 
middle class. The FTAs before us today are valuable because they offer 
a reduction of barriers to trade in financial services with Singapore, 
which is the largest U.S. export sector in Asia, and strong market 
access for U.S. goods in Chile.
  The agreements have strong intellectual property protections to fight 
the theft of copyrighted work and bold new measures to challenge 
digital and online piracy. These measures will help protect the driving 
force of creativity and innovation that has made entertainment and 
information technology the fastest growing sectors and the biggest 
exporting industries in the United States and in California.
  At the same time, the agreements unfortunately include provisions 
that set the wrong tone for the future of U.S. trade policy.
  I am concerned, for example, that because the U.S. Trade 
Representative's (USTR) model for automatic across the board tariff 
reductions in agriculture includes tobacco, the FTAs with Chile and 
Singapore could lead to an increase in cigarette consumption. 
Similarly, in the area of services, I am concerned that more exceptions 
should have been made for public utilities in order to safeguard 
government authority to protect consumers in the event of a crisis.
  I am deeply disappointed that the Administration refused to include 
the U.S.-Jordan FTA standards that require the enforcement of 
environmental laws and the adoption of labor laws consistent with the 
five core International Labor Organization (ILO) standards. While laws 
in Chile and Singapore may already meet these standards, the omission 
sends a wrong message that the basic principles of international 
workers rights and environmental protection are slipping from the U.S. 
trade agenda.
  I am also disappointed that the Administration did not use the Chile 
and Singapore FTAs as an opportunity to explicitly clarify that the 
investor-to-state provisions of the agreement do not give foreign 
companies greater rights than U.S. investors have under U.S. law. Even 
though the definition of expropriation in the Singapore and Chile FTAs 
is narrower than NAFTA, more changes are necessary to fix this 
distorted mechanism. Experience tells us that it is being abused to 
challenge U.S. regulatory and environmental law.
  Moreover, I strenuously object to the FTAs' grant of extended 
monopoly periods to pharmaceutical companies, during which they will 
face no competition from generic drugs. Many people describe these 
protections as a simple extension of the Hatch-Waxman legislation that 
applies to the American market to our trading partners, but this is a 
serious distortion of the bill I co-authored. Hatch-Waxman was passed 
to overcome existing regulatory barriers in the U.S. market to the 
approval of low-cost generic drugs. In exchange for this new authority, 
the law provided specified periods of exclusive marketing and patent 
extensions to pharmaceutical companies, allowing them to recoup 
development costs. The length of any exclusive marketing period, during 
which no generic version could be marketed, was tied to the degree of 
innovation represented by the drug.
  As a co-author of Hatch-Waxman, I cannot emphasize enough that this 
carefully balanced legislation represented a tailored solution to a 
specific regulatory problem in the United States. By adding these 
provisions to trade agreements, the USTR is heedlessly extending the 
exclusive marketing periods of Hatch-Waxman (and, in some cases, even 
more generous exclusive marketing periods) to other countries whose 
generic drug markets and health-care regulatory systems may look 
nothing like those in the United States. Although the impact of these 
protections may be limited in developed countries like Chile and 
Singapore it would be devastating in other countries that lack 
affordable and available life saving medicines and endure dangerous 
health epidemics.
  In voting for this legislation, I want to make it clear that the 
Chile and Singapore agreements should not be adopted as ``cookie-
cutter'' prototypes for other FTA's currently being negotiated. The 
economic, social, and political diversity of Central America, Morocco, 
Australia, and the other countries slated for inclusion in the Free 
Trade Agreement of the Americas and the Southern Africa Customs Union 
are simply too diverse to be forced in the Chile and Singapore mold.
  International trade has the potential to raise the standard of living 
and quality of life for millions of people around the world. To achieve 
this, however, we must work for progressive, forward-looking agreements 
that not only expand markets, but protect worker and consumer rights 
and the environment. What is acceptable for Chile and Singapore will 
not be adequate in other countries. We must negotiate future FTAs to 
ensure that our citizens and our trading partners have the opportunity 
to experience the full benefits of free and fair trade.

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